Unfortunately, the app doesn't work too well for users that use the default stock Silent Ringtone.
In order to create a silent ringtone, you will first need to download either of the following custom silent ringtone sound files:
Once either of these files is downloaded, you will need to set your ringtone to be either of these files. On my Nexus One, I couldn't find an obvious way to do this, but I did notice that placing the downloaded file on my SD card in a folder called 'ringtones' did the trick.
Then from Settings, Sounds, Phone Ringtone, I selected the Silent ringtone (not the one at the top of the list, but the one that you find alphabetically).
Let me know if you need more information.